Turkish Lira dropped nearly 30% since Friday, 10th August 2018 and one stage and has since recovered nearly half of the losses and now trading at 6.4093 which is still nearly 15% below where it was last Friday. We know that US President Donald Trump doubled Tariffs on Steel and Aluminium Imports from Turkey on Friday which is said to be the reason for the sharp decline in Turkish Lira (rally in USDTRY). In this blog, we take a look at the Elliott Wave structure of USDTRY and explain why the spike higher stopped where it stopped.

USDTRY Daily Elliott Wave View

USDTRY chart below shows Elliott wave structure since January 2017 peak that we have labelled as red wave I. Dip to 3.4019 completed red wave II, rally to 3.982 complete wave ((1)) of III, dip to 3.4019 completed wave ((2)), rally to 4.9768 completed wave ((3)), whereas dip to 4.735 completed wave ((4)). After that USDTRY made a new high in wave ((5)) made a small pull back and then continued higher in a possible extended 5th wave. This extended 5th wave ended in the blue box area between 1.236 – 1.618 Fibonacci extension of red I-II and sharp reaction lower from there suggests red wave III should be complete and we should be in the red wave IV pull back which could either take the form of a double correction lower towards 5.743 – 5.286 or could become a sideways triangle consolidation. Fact that USDTRY has already retraced most of the gains after President Trump’s tweet about doubling of Tariffs on Friday, 10th August 2018 shows the move higher was a panic reaction which created extended 5th wave.

USDTRY (Turkish Lira) – What’s Next?

Chart Below shows Elliott Wave Analysis of USDTRY on monthly time frame. Rally appears impulsive since 1997 low when we have ended III of (III) and after a pull back in wave IV, we should see extension higher towards 7.755 – 8.00 area to complete wave (III). Then, we could see a multi-year pull back / consolidation in wave (IV) before a final push higher to complete a 5 waves impulse rally higher from 1997 low. Then, USDTRY should see a larger 3 waves pull back to correct the entire rally from 1997 low back towards 4.00 – 5.00 area.

By Daud Bhatti

https://elliottwave-forecast.com

ElliottWave-Forecast has built its reputation on accurate technical analysis and a winning attitude. By successfully incorporating the Elliott Wave Theory with Market Correlation, Cycles, Proprietary Pivot System, we provide precise forecasts with up-to-date analysis for 78 instruments including Forex, Commodities, Indices and a number of Stocks & ETFs from around the World. Our clients also have immediate access to our proprietary Actionable Trade Setups, Market Overview, 1 Hour, 4 Hour, Daily & Weekly Wave Counts. Live Screen Sharing Sessions, Daily Technical Videos, Elliott Wave Setup and Weekend videos .

Copyright © 2018 ElliottWave-Forecast - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Only logged in users are allowed to post comments. Register/ Log in

The Market Oracle is a FREE Financial Markets Forecasting & Analysis web-site.
(c) 2005-2024 MarketOracle.co.uk (Market Oracle Ltd) - Market Oracle Ltd asserts copyright on all articles authored by our editorial team and all comments posted. Any and all information provided within the web-site, is for general information purposes only and Market Oracle Ltd do not warrant the accuracy, timeliness or suitability of any information provided on this site. nor is or shall be deemed to constitute, financial or any other advice or recommendation by us. and are also not meant to be investment advice or solicitation or recommendation to establish market positions. We do not give investment advice and our comments are an expression of opinion only and should not be construed in any manner whatsoever as recommendations to enter into a market position either stock, option, futures contract, bonds, commodity or any other financial instrument at any time. We recommend that independent professional advice is obtained before you make any investment or trading decisions. By using this site you agree to this sites Terms of Use. From time to time we promote or endorse certain products / services that we believe are worthy of your time and attention. In return for that endorsement and only in the cases where you purchase directly though us may we be compensated by the producers of those products.